U.S. SEC Found CZ’s ‘Backdoor’ Access to Users Fund

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The U.S. Securities and Exchange Commission (SEC) is looking into whether Binance founder CZ still has control over user funds on Binance US. This investigation comes on the heels of CZ’s recent guilty plea to charges by the U.S. Department of Justice (DOJ).

CZ’s ‘Backdoor’ Access to Users Fund

As part of the settlement with the DOJ, CZ resigned from his position as Binance CEO, securing release from jail on a substantial $175 million personal recognizance bond. The charges against him relate to the alleged operation of an anti-money laundering system.

The SEC is now laser-focused on obtaining evidence that CZ might still have a ‘backdoor’ entry to Binance US assets, according to an exclusive report by the Wall Street Journal. 

This scrutiny comes in the wake of a lawsuit filed by the SEC in June 2023, accusing Binance of operating a securities exchange illegally. Simultaneously, the SEC is investigating the possibility of a scenario akin to the fallout experienced by FTX in November 2022.

Coinbase’s Stock Surge

While Binance’s legal troubles unfold, Coinbase’s stock has reached a new peak, hitting around $121 on November 27, 2023. This marks the highest point since May 22, 2022.

The contrast in the legal situations of the two major cryptocurrency exchanges adds an intriguing layer to the dynamics of the crypto market. As Binance addresses regulatory challenges, Coinbase seems to be enjoying a positive momentum in the stock market.

New Leadership, New Direction

Richard Teng, the newly appointed CEO, has taken over leadership responsibilities following CZ’s guilty plea and subsequent departure. Teng has committed to a strategic shift, placing a strong emphasis on regulatory compliance. 

This shift in approach signals a departure from CZ’s leadership style, with Teng expressing a desire to collaborate with regulators globally and build a reputation centered on trust. As the investigation unfolds, it poses crucial questions about the future trajectory of Binance.